Ultimate Selling Guide

March 2011, First Edition

Selling a property can be an overwhelming and at times an emotional process.

This guide has been developed to provide you with everything you need to know about selling a property. With the help of various tips, checklists and graphs, this useful guide will help you to navigate the market and secure a successful sale.

Should I Buy or Sell First?

When it comes to selling a property, the age-old issue which you may face is should you sell or buy first? Timing, seasonality and market conditions are strong factors contributing to this decision.

In order to determine which strategy may be best suited to your personal circumstances, it is important to weigh up the pros and cons of each option.

Table 1: The Pros and Cons of Buying vs. Selling First
Selling First Buying First
Pros
  • There is no need to apply for a bridging loan to finance both properties.
  • You will know the exact amount of money you will have to put towards your next purchase.
  • You will not have any urgency to sell, therefore you can wait until you are happy with the sale price of the property.
  • You will have the certainty of only moving once.
  • You can spend all the time you need to find your new home.
Cons
  • You may be forced to rent until you find your next home – thus you will need to move twice.
  • You may feel pressured to find your next home and rush your buying decision.
  • You may be forced to obtain a bridging loan in order to finance the payments on both properties in the interim.
  • Should your existing home not sell for the desired price, you may need to source additional funds to cover the shortfall.
  • The burden of two mortgages could influence you to accept a lower offer.

When is the Best time to Sell?

The timing of selling your home will largely depend on your personal circumstances and needs. However, there are certain factors such as seasonality and market conditions which you should consider when selling your property. Although these factors may influence the sale both positively and negatively, and at times cannot be controlled, it is vital to consider each carefully.

Seasonality

Graph 1: The Seasonal Fluctuations in the Real Estate Market

The above graph shows that based on trends from the past 3 years:

  • Spring is considered to be the most popular season with the most sales occurring in the market. As the graph shows, October and November are the peak sales months in Spring.
  • The Autumn season also shows strong property sales in the market. However, sales tend to be fewer in comparison to the spring season.
  • Although the above graph shows seasonal fluctuations, consider these in conjunction with market conditions detailed below to determine when is the best time to sell your property.

Market Conditions

Market conditions may change due to many factors such as interest rates, employment, rises in

living cost, etc. These factors will influence both buyer and seller demand.

As a seller it is important to understand what market you are selling in as it may impact the sale price of the property.

Seller’s Market

A seller’s market occurs when demand for homes exceeds the amount of homes which are available for sale. This can be city wide but more often on a suburb by suburb basis.

How it may affect you:

  • In a seller’s market, you are more likely to sell your property for a higher price. However, it is important not to overprice the property as this may still impact your ability to sell.

Buyer’s Market

A buyer’s market occurs when the number of homes available for sale exceeds the number of buyers who are looking to buy.

How it may affect you:

  • In a buyer’s market, you need to ensure your price is realistic, appreciate it may take a little longer to sell and ensure you work with your real estate agent to maximise your selling price.

Our Top Tip: in order to determine the best time to sell, you will need to consider your personal plans, market conditions and seasonal factors.

NEXT: Valuing Your Home